Sterling started the week on the back foot, with the British Banking Association releasing its mortgage approval figures. As expected, the numbers fell from the previous month, but examining the annualised number puts into prospective the slide in confidence that the UK is experiencing.
The year-on-year figure (Aug 15 vs Aug 16) compared to this time last year is down 21%. As a standalone number, approvals are currently at a 19-month low. On a brighter note, the amount of mortgage lending was 1.0% higher on the year, in overall value terms. This suggests that there has been a sharp slowdown at the lower end of the market while the upper end of the market remains steady.
It is worth noting that a survey has been conducted by KPMG. Their survey revealed that three-quarters of British company bosses are considering moving operations abroad following the vote to leave the European Union. However the same survey revealed that 86% were confident about their companies’ growth prospects. More than two thirds were confident about the British economy’s growth prospects over the next three years. The revelation that three-quarters of British company bosses are considering moving operations abroad highlight the importance of the negotiations between the UK and EU.